The Folly of Medicare for All

Medicare is not free.

The Medicare payroll tax started in 1966 for private and corporate employers, their employees, and those who were self-employed at that time.  Federal employees didn’t start paying Medicare taxes until 1983.  Most retirees currently claiming Medicare have contributed throughout their lifetime, and monthly contributions continue to be taken out of Social Security benefits based on the previous year’s income.  At the end of last year, it was announced that 2024 Medicare monthly premiums were going up 14.5 percent, and the Medicare Part B deductible is also increasing by $30.  Early estimates indicate that the 2025 increase may be five to ten percent.  The cost of expensive Medicare supplemental policies increase as we age and don’t cover everything — especially costly prescriptions.

Insurance is something you pay dearly for, all the while hoping you won’t need it.  In the past, keeping yourself continuously insured meant you wouldn’t be subject to pre-existing conditions exclusion or wait periods for coverage.  From my perspective, it was logical to exclude coverage for those individuals who would pay for insurance only when they needed it and not participate in the pool, spreading the risk.  Unfortunately, if you have an accident or illness without insurance, you can end up paying for it for the rest of your life or go into bankruptcy.

Insurance companies regulate fees for service, and Medicare does not pay well.  The following is important to consider: because of the low compensation, not all doctors accept Medicare patients.  Some will limit the number to a small percentage of their panel, and others will accept Medicare patients if they pay an annual fee.  Also, a surprising number of doctors and health care facilities such as physical therapy don’t accept Medicaid or Obamacare insurance.  Some well established practices aren’t taking new patients, and some specialists will take patients only by referral.

Also, concierge medicine is on the rise.  A concierge practice usually limits its patient rolls to fewer than 500 patients, which allows doctors to spend more time with patients and focus on preventative health care.  Moreover, a concierge practice offers same-day visits when necessary, 24-hour access to the doctor, shorter waiting room times, and sometimes even house calls.  Concierge Medicine Today states that about 5,000 to 7,000 physicians and practices provide concierge care in the United States, most of whom are primary care providers.  Average annual fees typically range from $1,200 to $50,000, with a few as much as $100,000, though that high a fee is not characteristic.

Unfortunately, there are simply not enough doctors to provide health care for everyone in the country, and it is not expected to get better.  Jenny Yang writes at Statista that “by the year 2036, a shortage of 13,500 to 86,000 physicians is expected in the United States.”

In four decades from 1980 to 2020, the population has increased by about 105 million.  The number of medical schools and practicing physicians did not keep pace with the population growth, and a large percentage of physicians are over 40 years old.  In Table A below, the number of practicing physicians includes all specialties, and the population figures do not include the 20+ million illegal aliens in the country if they weren’t included in the Census.

Image: Pkd2016 via Wikimedia Commons, CC BY-SA 2.0.

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Image: Pkd2016 via Wikimedia Commons, CC BY-SA 2.0.

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